Zeppelin Station on Thursday, March 1, 2018. Zeppelin Station, a new 100,000-square-foot project from Zeppelin development, is set to open in mid March. With co-working space on top and a food hall on the ground floor, the building represents the next stage in RiNo’s evolution from industrial corridor to center of the city’s hottest office market and dining area.

The new offices of the River North Art District are bigger, brighter and more expensive.

In 2018, with the guidance of then-President Jamie Giellis, the organization’s board voted to move from an $800-a-month room on Blake Street to an $8,200-a-month suite in Zeppelin Station, a new indoor marketplace.

The new space is three times as large and includes a retail storefront with racks of RiNo-branded merchandise and goods from local artists.

The new headquarters reflects the growth of what started as an artists’ organization and now has a multimillion-dollar budget. Giellis’ work in River North is the most prominent local experience that the urban planning consultant can point to in her bid to run Denver, a city with a population of about 700,000. Her supporters credit her for winning urbanist improvements in the district, including bioswales and bike lanes along Brighton Boulevard and artistic lighting on the 38th Street underpass.

But since Giellis left to run for mayor, the organization’s board has been divided over its finances. The new office space was among the most contentious issues raised by insiders as The Denver Post reviewed the candidate’s time in River North. More than a one-off decision, it’s the latest flashpoint among developers, artists and residents in the development zone.

“We had an affordable office that was accessible,” said Tai Beldock, one of the property owners who funds the district through taxes on her family’s motorcycle dealership and warehouse property.

“As a small business owner — that (money) could pay for crosswalks,” said Beldock, a Hancock supporter and former RiNo board member. “Or maybe it would pay for the study the city needs to turn Walnut into a two-way street. But no, it’s going into the pockets of the Zeppelins.”

Since Giellis’ departure, RiNo’s new leader has asked for a 50 percent reduction in rent from the Zeppelin company, which already granted months of free occupancy. The Zeppelin family — among Giellis’ chief financial supporters in her mayoral run — also has donated tens of thousands of dollars to the art district for events and other causes. The company’s five-year lease with RiNo includes an exit option at two years.

“We’ve been flexible to work with (the board) if at any point it doesn’t work,” Kyle Zeppelin said.

The topic came up at a 9News debate Tuesday, with incumbent Mayor Michael Hancock questioning the spending. Giellis downplayed her involvement in the deal.

“My name is not on any lease,” she said. “The board made that decision, not me.”

The lease was approved in a 5-2 vote of the district’s central oversight board, with three members abstaining, according to meeting minutes. Andy Feinstein, a Hancock supporter, was among the approving votes.

“My role in it was really presenting the idea to the board, presenting the numbers and kind of working through all of that,” Giellis said in an interview.

She thought that the idea of the store and expanded space was an “interesting opportunity” but acknowledged that it caused a debate on the board: Should the organization spend more to promote itself and its artists, or should it run more conservatively?

Ultimately, she said, the 2,400-square-foot space was “an interim move that was at times a bit of an experiment.” The store makes up about a quarter of the footprint.

Room for a growing organization

John McCaskill, a gallery and store owner in the district, said the new space fits a growing organization. It represents how RiNo is “positioning itself for the district that it’s going to be,” he said, joking that Teslas now outnumber bicycles. “You can’t get cheap rent in this neighborhood. You might as well get a nice place.”

But, for now, the organization is struggling with the new expenses.

In March, Sonia Danielsen, a board member for the River North Art District, said the store was “bleeding the (art district) dry,” according to meeting minutes. The store was supposed to pay about half the rent of the new office, but sales haven’t met costs.

RiNo Made sold about $8,800 worth of goods in March, according to internal documents, but needs to do $24,000 in monthly sales to break even, said Tracy Weil, the district’s new president. The store delivered about $4,800 in commissions to artists that month. Giellis noted that it can take time for a retail store to find its footing.

To Giellis’ critics, including some of the district’s biggest funders, it’s an example of the organization’s excessive appetite and poor financial decisions. “There’s a number of us that felt like we would like to see the property taxes go back down,” said Bernard Hurley, a Hancock supporter who’s planning a major development in the area.

But her supporters say she was an expert navigator of the district’s cross-currents, bridging the needs of artists, developers and residents.

“My observation of Jamie was she was very adept at handling a pretty powerful, strong-opinioned board,” said Fiona Arnold, a local landowner and former economic development chief under Gov. John Hickenlooper, now the treasurer of Giellis’ campaign.

“She seems to be able to stand up to those interests, and she’s very strong on that.”

RiNo’s origins

To understand the tension in RiNo, it helps to know a little history.

In 2014, Brighton Boulevard was the “next” hot spot for the development that was spreading out of downtown Denver. The big pieces were already in place: The city planned to rebuild the busy road, developers were buying land, and the art scene was thriving.

But there was a divide, according to Jason Winkler, co-founder of the Industry office spaces.

On one side were a handful of large property owners. They wanted to fund physical improvements and put their major projects in sync. On the other was the River North Art District, a culture-focused organization that had formed in the mid-2000s. Weil was a co-founder.

In came Jamie Giellis — then Jamie Licko — a 30-something consultant who had built her reputation working around the world with local districts to fund and manage development.

“She started to kind of bring everything together into one group,” Winkler said. With Giellis playing coordinator, the art district and the property owners laid the groundwork for a pseudo-municipal juggernaut.

Property owners agreed to pay extra taxes — from 4 to 8 mills or more, depending on the location. The organization’s scope would range from maintenance to cultural events such as Crush Walls, the street-mural festival. It also contributed several million dollars to the rebuilding of Brighton Boulevard, one of the district’s biggest city projects.

Today, the River North Art District commands a budget of more than $2 million from extra taxes on property within its borders, and it has five full-time staffers. The district has not disclosed what Giellis’ company, Centro, was paid for her work before she departed.

But the district’s financial decisions have rankled some of its most powerful figures.

A group of landowners — Hurley, Winkler and Tom Gordon — attempted to terminate Giellis’ contract with the general improvement district in January 2017. They failed in a 4-3 vote.

“Jamie’s hanging her hat on the business success in RiNo, when in reality the business community hasn’t supported her, and she hasn’t worked for the business community,” Winkler said. “The artists have supported her, and they should, because she’s done certainly a better job on the art district side.”

Andrew Kenney covers Denver and its government. He's interested in how power and development are shaping the city. He previously worked as a reporter for The (Raleigh) News & Observer and for Denverite. Email him at akenney@denverpost.com or call 303-954-1785.

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